MPC.

Question

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Answer 1

Question

Chapter 10, Problem 3P

Subpart (a):

To determine

MPC.

Subpart (a):

Expert Solution

Explanation of Solution

The slope of the linear equation is the MPC; here, it is equal to 0.8. Thus, MPC is 0.8.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (b):

To determine

MPS.

Subpart (b):

Expert Solution

Explanation of Solution

The MPS is evaluated as follows:

Marginal propensity to save=1-Slope of the linear equation =1-0.8 =0.2

Thus, MPS is 0.2.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (c):

To determine

Consumption.

Subpart (c):

Expert Solution

Explanation of Solution

Consumption can be calculated as follows:

Level of consumption=($40+Slope of linear equation)×Income =($40+0.8)×$400 =$360

Total consumption is $360.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (d):

To determine

APC.

Subpart (d):

Expert Solution

Explanation of Solution

The average propensity to consume (APC) is evaluated as follows:

Average propensity to consume=ConsumptionIncome =$360$400 =0.9

Average propensity to consume is 0.9.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (e):

To determine

Level of saving.

Subpart (e):

Expert Solution

Explanation of Solution

The level of saving can be evaluated as follows:

Level of saving=Income-Consumption =$400-$360 =$40

Total saving is $40.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (f):

To determine

APS.

Subpart (f):

Expert Solution

Explanation of Solution

The average propensity to saving (APS) is evaluated as follows:

Average propensity to save=SavingIncome =$40$400 =0.1

Average propensity to save is 0.1.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

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Answer 2

Question

Chapter 10, Problem 3P

Subpart (a):

To determine

MPC.

Subpart (a):

Expert Solution

Explanation of Solution

The slope of the linear equation is the MPC; here, it is equal to 0.8. Thus, MPC is 0.8.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (b):

To determine

MPS.

Subpart (b):

Expert Solution

Explanation of Solution

The MPS is evaluated as follows:

Marginal propensity to save=1-Slope of the linear equation =1-0.8 =0.2

Thus, MPS is 0.2.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (c):

To determine

Consumption.

Subpart (c):

Expert Solution

Explanation of Solution

Consumption can be calculated as follows:

Level of consumption=($40+Slope of linear equation)×Income =($40+0.8)×$400 =$360

Total consumption is $360.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (d):

To determine

APC.

Subpart (d):

Expert Solution

Explanation of Solution

The average propensity to consume (APC) is evaluated as follows:

Average propensity to consume=ConsumptionIncome =$360$400 =0.9

Average propensity to consume is 0.9.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (e):

To determine

Level of saving.

Subpart (e):

Expert Solution

Explanation of Solution

The level of saving can be evaluated as follows:

Level of saving=Income-Consumption =$400-$360 =$40

Total saving is $40.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (f):

To determine

APS.

Subpart (f):

Expert Solution

Explanation of Solution

The average propensity to saving (APS) is evaluated as follows:

Average propensity to save=SavingIncome =$40$400 =0.1

Average propensity to save is 0.1.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

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Answer 3

Question

Chapter 10, Problem 3P

Subpart (a):

To determine

MPC.

Subpart (a):

Expert Solution

Explanation of Solution

The slope of the linear equation is the MPC; here, it is equal to 0.8. Thus, MPC is 0.8.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (b):

To determine

MPS.

Subpart (b):

Expert Solution

Explanation of Solution

The MPS is evaluated as follows:

Marginal propensity to save=1-Slope of the linear equation =1-0.8 =0.2

Thus, MPS is 0.2.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (c):

To determine

Consumption.

Subpart (c):

Expert Solution

Explanation of Solution

Consumption can be calculated as follows:

Level of consumption=($40+Slope of linear equation)×Income =($40+0.8)×$400 =$360

Total consumption is $360.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (d):

To determine

APC.

Subpart (d):

Expert Solution

Explanation of Solution

The average propensity to consume (APC) is evaluated as follows:

Average propensity to consume=ConsumptionIncome =$360$400 =0.9

Average propensity to consume is 0.9.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (e):

To determine

Level of saving.

Subpart (e):

Expert Solution

Explanation of Solution

The level of saving can be evaluated as follows:

Level of saving=Income-Consumption =$400-$360 =$40

Total saving is $40.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (f):

To determine

APS.

Subpart (f):

Expert Solution

Explanation of Solution

The average propensity to saving (APS) is evaluated as follows:

Average propensity to save=SavingIncome =$40$400 =0.1

Average propensity to save is 0.1.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

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Answer 4

Question

Chapter 10, Problem 3P

Subpart (a):

To determine

MPC.

Subpart (a):

Expert Solution

Explanation of Solution

The slope of the linear equation is the MPC; here, it is equal to 0.8. Thus, MPC is 0.8.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (b):

To determine

MPS.

Subpart (b):

Expert Solution

Explanation of Solution

The MPS is evaluated as follows:

Marginal propensity to save=1-Slope of the linear equation =1-0.8 =0.2

Thus, MPS is 0.2.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (c):

To determine

Consumption.

Subpart (c):

Expert Solution

Explanation of Solution

Consumption can be calculated as follows:

Level of consumption=($40+Slope of linear equation)×Income =($40+0.8)×$400 =$360

Total consumption is $360.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (d):

To determine

APC.

Subpart (d):

Expert Solution

Explanation of Solution

The average propensity to consume (APC) is evaluated as follows:

Average propensity to consume=ConsumptionIncome =$360$400 =0.9

Average propensity to consume is 0.9.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (e):

To determine

Level of saving.

Subpart (e):

Expert Solution

Explanation of Solution

The level of saving can be evaluated as follows:

Level of saving=Income-Consumption =$400-$360 =$40

Total saving is $40.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (f):

To determine

APS.

Subpart (f):

Expert Solution

Explanation of Solution

The average propensity to saving (APS) is evaluated as follows:

Average propensity to save=SavingIncome =$40$400 =0.1

Average propensity to save is 0.1.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

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Answer 5

Chapter 10, Problem 3P

Subpart (a):

To determine

MPC.

Subpart (a):

Expert Solution

Explanation of Solution

The slope of the linear equation is the MPC; here, it is equal to 0.8. Thus, MPC is 0.8.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (b):

To determine

MPS.

Subpart (b):

Expert Solution

Explanation of Solution

The MPS is evaluated as follows:

Marginal propensity to save=1-Slope of the linear equation =1-0.8 =0.2

Thus, MPS is 0.2.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (c):

To determine

Consumption.

Subpart (c):

Expert Solution

Explanation of Solution

Consumption can be calculated as follows:

Level of consumption=($40+Slope of linear equation)×Income =($40+0.8)×$400 =$360

Total consumption is $360.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (d):

To determine

APC.

Subpart (d):

Expert Solution

Explanation of Solution

The average propensity to consume (APC) is evaluated as follows:

Average propensity to consume=ConsumptionIncome =$360$400 =0.9

Average propensity to consume is 0.9.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (e):

To determine

Level of saving.

Subpart (e):

Expert Solution

Explanation of Solution

The level of saving can be evaluated as follows:

Level of saving=Income-Consumption =$400-$360 =$40

Total saving is $40.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Subpart (f):

To determine

APS.

Subpart (f):

Expert Solution

Explanation of Solution

The average propensity to saving (APS) is evaluated as follows:

Average propensity to save=SavingIncome =$40$400 =0.1

Average propensity to save is 0.1.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 6

Chapter 10, Problem 3P

Subpart (a):

To determine

MPC.

Subpart (a):

Expert Solution

Explanation of Solution

The slope of the linear equation is the MPC; here, it is equal to 0.8. Thus, MPC is 0.8.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 7

Chapter 10, Problem 3P

Subpart (a):

To determine

MPC.

Answer 8

Subpart (a):

Expert Solution

Explanation of Solution

The slope of the linear equation is the MPC; here, it is equal to 0.8. Thus, MPC is 0.8.

Answer 9

Subpart (a):

Expert Solution

Answer 10

Subpart (a):

Expert Solution

Answer 11

Expert Solution

Answer 12

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 13

Subpart (b):

To determine

MPS.

Subpart (b):

Expert Solution

Explanation of Solution

The MPS is evaluated as follows:

Marginal propensity to save=1-Slope of the linear equation =1-0.8 =0.2

Thus, MPS is 0.2.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 14

Subpart (b):

To determine

MPS.

Answer 15

Subpart (b):

Expert Solution

Explanation of Solution

The MPS is evaluated as follows:

Marginal propensity to save=1-Slope of the linear equation =1-0.8 =0.2

Thus, MPS is 0.2.

Answer 16

Subpart (b):

Expert Solution

Answer 17

Subpart (b):

Expert Solution

Answer 18

Expert Solution

Answer 19

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 20

Subpart (c):

To determine

Consumption.

Subpart (c):

Expert Solution

Explanation of Solution

Consumption can be calculated as follows:

Level of consumption=($40+Slope of linear equation)×Income =($40+0.8)×$400 =$360

Total consumption is $360.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 21

Subpart (c):

To determine

Consumption.

Answer 22

Subpart (c):

Expert Solution

Explanation of Solution

Consumption can be calculated as follows:

Level of consumption=($40+Slope of linear equation)×Income =($40+0.8)×$400 =$360

Total consumption is $360.

Answer 23

Subpart (c):

Expert Solution

Answer 24

Subpart (c):

Expert Solution

Answer 25

Expert Solution

Answer 26

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 27

Subpart (d):

To determine

APC.

Subpart (d):

Expert Solution

Explanation of Solution

The average propensity to consume (APC) is evaluated as follows:

Average propensity to consume=ConsumptionIncome =$360$400 =0.9

Average propensity to consume is 0.9.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 28

Subpart (d):

To determine

APC.

Answer 29

Subpart (d):

Expert Solution

Explanation of Solution

The average propensity to consume (APC) is evaluated as follows:

Average propensity to consume=ConsumptionIncome =$360$400 =0.9

Average propensity to consume is 0.9.

Answer 30

Subpart (d):

Expert Solution

Answer 31

Subpart (d):

Expert Solution

Answer 32

Expert Solution

Answer 33

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 34

Subpart (e):

To determine

Level of saving.

Subpart (e):

Expert Solution

Explanation of Solution

The level of saving can be evaluated as follows:

Level of saving=Income-Consumption =$400-$360 =$40

Total saving is $40.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 35

Subpart (e):

To determine

Level of saving.

Answer 36

Subpart (e):

Expert Solution

Explanation of Solution

The level of saving can be evaluated as follows:

Level of saving=Income-Consumption =$400-$360 =$40

Total saving is $40.

Answer 37

Subpart (e):

Expert Solution

Answer 38

Subpart (e):

Expert Solution

Answer 39

Expert Solution

Answer 40

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 41

Subpart (f):

To determine

APS.

Subpart (f):

Expert Solution

Explanation of Solution

The average propensity to saving (APS) is evaluated as follows:

Average propensity to save=SavingIncome =$40$400 =0.1

Average propensity to save is 0.1.

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.

Answer 42

Subpart (f):

To determine

APS.

Answer 43

Subpart (f):

Expert Solution

Explanation of Solution

The average propensity to saving (APS) is evaluated as follows:

Average propensity to save=SavingIncome =$40$400 =0.1

Average propensity to save is 0.1.

Answer 44

Subpart (f):

Expert Solution

Answer 45

Subpart (f):

Expert Solution

Answer 46

Expert Solution

Answer 47

Economics Concept Introduction

Concept Introduction:

Marginal propensity to consume: Marginal propensity to consume refers to the sensitivity of change in the consumption level due to changes occurred in the income level.

Marginal propensity to save (MPS): Marginal propensity to save refers to the sensitivity of change in the saving level due to changes occurred in the income level.